What is the maximum investment income a taxpayer is allowed to have and still be allowed to claim the earned income credit? Why is there an investment income limit in the tax law regarding the credit?
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- Question 6: FUTA tax is paid solely by the employer. Answer: A. True В. FalseThe use of the earned income credit could result in a taxpayer receiving a refund even though the taxpayer has not paid any income taxes.TrueFalse1. What loan from the federal government given to individual states is used to provide unemployment benefits to state residents? Answer: A. SUTA Advances B. FUTA Advances C. Title XII Advances D. Title 15 Advances 2. The SUTA tax rate is determined by an employer’s _____. Answer: A. credit reduction B. FUTA tax rate C. experience rating D. Medicare tax rate 3. Identify each item as associated with Form 1099-NEC, Form 1096, or both. A. Displays earnings for one individual Form 1099-NEC Form 1096 Both B. Displays earnings for multiple individuals Form 1099-NEC Form 1096 Both C. Requires a signature Form 1099-NEC Form 1096…
- From the following list of tax credits, which credits help to reduce the tax liability on a taxpayer's taxable income? 1. Personal tax credit 2. Earned income credit 3. Child savers credit 4. Student loan interest credit 1, 2, and 3. 2 and 3. 2, 3, and 4. 1, 2, 3, and 4.5. What type of tax goes to help pay for medical care of people over 65 years old? a. Income tax b. Property tax c. Sales Tax d. Social Security tax e. Medicare tax 6. What type of tax takes a percentage of the money you make on a job? a. Income tax b. Property tax c. Sales Tax d. Social Security tax e. Medicare tax 7. What type of tax goes to help pay for retirement? a. Income tax b. Property tax c. Sales Tax d. Social Security tax e. Medicare tax 8. True or False: Businesses don't have to pay any taxes in the United States. a. TRUE b. FALSE 9. According to the article, where does the United States rank worldwide in highest income taxes? a. 1st b. 7th c. 25th d. 100th e. 150th 10. What is the name of the agency that collects taxes in the United States? a. Secret Service b. Federal Bureau of Investigation c. Internal Revenue Service d. Department of Energy e. Department of the InteriorK Explain how a deduction, such as the mortgage interest tax deduction, can save you money. Why do deductions benefit people in different tax brackets differently? Choose the correct answer below. OA. A tax deduction saves money by decreasing the tax bill directly. The amount saved is proportional to the tax bracket marginal rate. OB. A tax deduction saves money by decreasing the taxable income. The amount saved is proportional to the tax bracket marginal rate. OC. A tax deduction saves money by decreasing the tax bill directly. The amount saved is limited by the tax bracket marginal rate. OD. A tax deduction saves money by decreasing the taxable income. The amount saved is limited by the tax bracket marginal rate.
- Check Your Progress 3 Why is it important for taxpayers to recognize the income tax deductions? Answer areaWhich of the following is an adjustment that will generally result in lower tax liability for an eligible taxpayer because it directly reduces the taxpayer's total income? An education credit. The health savings account deduction. Medical and dental expenses deduction. The retirement savings contributions credit (Saver's Credit)Question 10: What types of wage garnishments are typically satisfied before others? Answer: A. Student loan payments and state/federal tax levies В. Alimony and child support payments С. O Child support payments and federal tax levies D. O State and federal tax levies
- Tax-sheltering for which of the following types of expenses cannot be had through a type of FSA? oooo Physician expenses Dependent care Prescription drugs Life insurance premiums Question 8 Contributions to a Roth IRA and a Coverdell education savings account are both tax-deductible, and earnings accumulate tax-free. True False Question 9 The amount of income tax withheld can be found on one's W-2 form. True FalseYou are employed. Your salary is your only source of income. You are subject to which of the following taxes? A. Income Tax B. Business Tax C. A and B D. None of thesewhich of the following is not a covid-19 tax relief provision available to a self-employed taxpayer? A. payroll tax deferral B. sick leave credit C. family leave credit D. self-employed tax rate reduction E. all the above